India–US Trade Deal: India and the United States finalised a trade agreement on Monday. On February 2, 2026, U.S. President Donald Trump announced on his Truth Social account that the two countries had signed a trade deal that will reduce tariffs from 25% to 18%. According to Trump’s post, India will also cut its purchases of Russian oil and shift toward importing more oil from the United States.
Reuters reported that following the announcement, the total U.S. tariff on Indian goods has been reduced to 18% from 50%. A White House official told Reuters that the United States would rescind a punitive 25% duty imposed on all Indian imports over New Delhi’s purchases of Russian oil, which had been levied on top of an existing 25% “reciprocal” tariff.
Following President Trump’s post, Prime Minister Narendra Modi also made a tweet about the development. Though the trade deal and tariff reduction. But the Prime Minister’s post did not have any mention of any oil deal.
BACKGROUND
The development of the trade deal was followed by a direct conversation between U.S. President Donald J. Trump and Indian Prime Minister Narendra Modi, after which both leaders publicly confirmed the agreement.
In a post on Truth Social, President Trump said, “It was an Honor to speak with Prime Minister Modi, of India, this morning. He is one of my greatest friends and, a Powerful and Respected Leader of his Country. We spoke about many things, including Trade, and ending the War with Russia and Ukraine. He agreed to stop buying Russian Oil, and to buy much more from the United States and, potentially, Venezuela. This will help END THE WAR in Ukraine, which is taking place right now, with thousands of people dying each and every week! Out of friendship and respect for Prime Minister Modi and, as per his request, effective immediately, we agreed to a Trade Deal between the United States and India, whereby the United States will charge a reduced Reciprocal Tariff, lowering it from 25% to 18%. They will likewise move forward to reduce their Tariffs and Non Tariff Barriers against the United States, to ZERO. The Prime Minister also committed to “BUY AMERICAN,” at a much higher level, in addition to over $500 BILLION DOLLARS of U.S. Energy, Technology, Agricultural, Coal, and many other products. Our amazing relationship with India will be even stronger going forward. Prime Minister Modi and I are two people that GET THINGS DONE, something that cannot be said for most. Thank you for your attention to this matter!“
Non-tariff barriers, as mentioned by President Trump, refer to rules and procedures that restrict trade without using taxes or customs duties. These include import licenses, complex regulations, strict product standards, lengthy approvals, and bureaucratic delays that make it harder or more expensive for foreign goods—like U.S. products—to enter the Indian market even when tariffs are reduced.
When Trump says India will reduce non-tariff barriers to zero, he is essentially signaling an easing of regulatory hurdles and smoother market access for U.S. companies. In simple terms, it means not just cheaper entry through lower tariffs, but also fewer procedural roadblocks after entry, allowing American goods and services to reach Indian buyers more easily and quickly.
Prime Minister Modi said the following in the twitter post, “Wonderful to speak with my dear friend President Trump today. Delighted that Made in India products will now have a reduced tariff of 18%. Big thanks to President Trump on behalf of the 1.4 billion people of India for this wonderful announcement.
When two large economies and the world’s largest democracies work together, it benefits our people and unlocks immense opportunities for mutually beneficial cooperation.
President Trump’s leadership is vital for global peace, stability, and prosperity. India fully supports his efforts for peace.
I look forward to working closely with him to take our partnership to unprecedented heights.“
Both leaders framed the deal as part of a wider effort to deepen strategic and economic relations. President Trump said the agreement would ensure that “our amazing relationship with India will be even stronger going forward,” while Prime Minister Modi stated that he looks forward to working closely with the U.S. President to take the partnership “to unprecedented heights.”
The tariff reduction and commitments outlined by both sides mark a notable shift in India–U.S. trade relations, with implications for exporters, manufacturers, and investors in both economies.
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